ENERGY

Don’t call it hangover, it’s wine flu

ENERGY Like all other developing countries, energy consumption in Pakistan has been increasing on average at a rate considerably higher than the increase in gross domestic production Over the last 13 years, from 1991 to 2004, the energy supply has increased from 284 ton oil equivalent (TOE) to 50 TOE, implying a rate of growth of 4 percent a year In terms of energy availability per head of the population, the increase has been from 0253 TOE in 1991 to 0352 TOE in 2004 This is still very low compared to the levels of energy consumption in more advanced developing countries, such as those in Southeast Asia Pakistan obtains energy from four different sources: petroleum products, gas, electricity, and coal The average consumption of petroleum products increased at a rate slightly greater than the increase in total energy consumption: 41 percent as against 4 percent

The consumption of gas increased by 37 percent per annum, that of electricity by 48 percent per annum, and that of coal 22 percent per annum This indicates that the share of electricity has increased in total consumption This trend reflects Pakistan’s energy endowment, since the country has very few indigenous resources of oil and fairly rapidly declining reserves of gas At one point, gas was in abundant supply, but no new large fields have been discovered in the last quarter century The country has a fairly large deposit of coal, but it is of relatively low quality, and will need a great deal of careful handling in order not to have an adverse effect on the environment Nevertheless, Pakistan has begun to work with China to exploit the reserves in the Thar region of Sindh provinceIn 2004, the production of crude oil declined to 62,000 barrels a day from 65,000 barrels a day in 2003 The transport sector, with a share of 476 percent in total consumption, is the highest consumer of petroleum products, followed by the power sector at 31

9 percent, industry at 122 percent, households at 39 percent, government at 25 percent, and agriculture at 18 percentIn 2004, the production of natural gas was estimated at 350 billion cubic meters (BCM) per day, compared to 289 BCM in 2003, an increase of 21 percent The power sector is the main consumer of gas at 348 percent, followed by the commercial sector at 189 percent, and households at 177 percent The installed capacity of electricity increased by 9

6 percent over the 2003-2004 period Total generation capacity in 2004 was 56,641 gigawatt hour (GWh), having increased from 54,426 GWh in 2003, implying an increase of 41 percent The total installed capacity of the Water and Power Development Authority stood at 11,436 MW, of which hydroelectricity accounted for 586 percent and the thermal sector for 414 percent About 3 percent of total electricity generation comes from two nuclear plants, one in Karachi and the other at Chasma A third plant is being built at Chasma with Chinese assistance Pakistan has carried out an extensive program for the electrification of villages over the last several years Some 68,820 villages, out of a total of about 100,000, have been provided with electrificationIf the economic rate of growth continues to increase at the rates registered in the last three years-in 2004-2005, GDP increased by 8

3 percent-Pakistan will need to see a significant increase in the supply of energy For this reason, the government of General Pervez Musharraf is giving high priority to the construction of gas pipelines to bring in this fuel from Iran, Turkmenistan, and Qatar-the three countries in the region that have large surpluses of natural gas